TNAG-1497-FCO40-2055-Guangdong-nuclear-power-station-project-at-Daya-Bay-safety-c-1986 — Page 272

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(A)

(B)

(C)

(D)

(E)

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BOTH SIDES HAVE SHOWN GREAT COMMITMENT TO THIS

PROJECT OVER THE YEARS, CULMINATING IN AGREEMENT

ON PRICE AND FINANCING IN JANUARY. BOTH SIDES

MUST CONTINUE TO SHOW RESPECT FOR THE OTHER'S

POSITION AND FIND MUTUALLY ACCEPTABLE SOLUTION

TO PERMIT SWIFT PROGRESS NOW THAT THE MAJOR

POINTS HAVE BEEN SETTLED.

SURPRISED AT CHINESE INSISTENCE ON INCLUSION OF

GOVERNMENT ASSURANCE FROM MOU IN LOAN AGREEMENT.

MEMORANDUM OF UNDERSTANDING IS A GOVERNMENT TO

GOVERNMENT DOCUMENT, SIGNED BY BOTH PARTIES.

CAN BE NO QUESTION THAT HMG WILL NOT HONOUR

TERMS OF MOU.

HMG CANNOT AGREE TO INCORPORATE TEXT OF

GOVERNMENT ASSURANCE INTO LOAN AGREEMENT, WHICH

IS A COMMERCIAL DOCUMENT TO WHICH HMG IS NOT A

PARTY. WE HAVE TAKEN LEGAL ADVICE ON THIS.

BOTH SIDES MUST THEREFORE GIVE UP SOMETHING IF

A SOLUTION TO BE FOUND. AUTHORITIES IN LONDON

HAVE CONSIDERED FURTHER PRC POSITION.

NEGOTIATORS IN SHENZHEN HAVE BEEN EMPOWERED

TO PUT FORWARD FRESH PROPOSALS ON THIS POINT.

LOOK FOR A POSITIVE RESPONSE FROM CHINESE SIDE

IN INTERESTS OF SWIFT SIGNATURE OF L.O.I.

(F)

(ONLY IF PRESSED: NEW PROPOSALS ENVISAGE

INCLUSION OF A REFERENCE TO RELEVANT PART OF

MOU.)

WE RECOMMEND AGAINST PUTTING FORWARD THE DETAILED TEXT OF

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